Bitcoin’s mining difficulty reached an all-time high, rising by 3.4% on Thursday. This increase corresponds to the level of effort required by miners to verify transactions on the network. At the same time, the hashrate, which measures the computational power dedicated to mining, also reached a record high.
A higher difficulty level means mining Bitcoin becomes more competitive and less profitable for miners.
Circumstance on Ramp
The mining difficulty for Bitcoin reached 51.23 trillion at block height 792,288 during Thursday’s adjustment. This comes after a 3.22% increase in the previous adjustment on May 18, as reported by BTC.com.
When more miners join the network, the difficulty of mining Bitcoin usually increases, creating more competition. Miners earn Bitcoin as a reward for verifying transactions. With higher difficulty, miners have a lower chance of successfully mining a whole block on the chain.
Therefore, a miner’s profitability depends on the difficulty level. Changes in mining difficulty are closely connected to variations in hashrate, which represents the amount of computing power used for mining.
On Wednesday, Bitcoin’s hashrate was approximately 375 exahashes per second, which showed an increase compared to the previous adjustment on May 18 when it was 365.1 exahashes, according to data from Blockchain.com.
During that time, Bitcoin was being traded at around US$26,800, marking a 61% increase for the year. As of 10:10 a.m. in Hong Kong on Thursday, its price stood at US$27,068, reflecting a 3.6% rise over the past seven days, based on data from CoinMarketCap.
This week, many Bitcoin mining-related stocks in the U.S. experienced gains. On Sunday, Republican congressman Warren Davidson mentioned that a suggested tax on electricity used by cryptocurrency miners in the country was no longer being considered. This decision is connected to the ongoing negotiations on the U.S. debt ceiling between the White House and House Republicans.
Also Read This : US House Passes Debt Ceiling Bill in Efforts to Avert Default
Shares of cryptocurrency mining company Marathon Digital Holdings on Nasdaq have gone up by 9.6% since the closing on Friday, marking a 187.9% increase for the year. Similarly, shares of Bitcoin miner Riot Platforms have risen by 9.9% since Friday, showing a 256% surge since the start of this year.
Important: This article is intended solely for informational purposes. It should not be considered or relied upon as legal, tax, investment, financial, or any other form of advice.
Join Cryptos Headlines Community: https://linktr.ee/cryptosheadlines.com
